EU funds a manual on public procurement rules

The Ukrainian public procurement sector requires immediate and substantial reforms. A significant amount of Ukrainian taxpayers’ money has been wasted on non-transparent and unjust public procurement tenders. Changes inspired by EU standards can introduce more transparency in the sector and can radically reduce the impact of conflicts of interest, privileged players, and overpricing in tender procedures.

The EU-Ukraine Association Agreement pays special attention to the approximation of Ukraine’s public procurement system to EU legislation. A new Ukrainian law on public procurement adopted in April 2014 aims to meet EU standards, thereby making Ukrainian public procurement procedures transparent, fair and efficient.

The manual’s main purpose is “to provide practical advice to public purchasers and tender participants on public procurement procedures,” says Valentin Derevyankin, deputy team leader of the EU project. He notes that the document contains a comprehensive analysis of Ukrainian public procurement legislation and advice for stakeholders on how to interpret specific provisions set out in these laws.

Though some of the provisions still require amendments, Ukrainian public procurement legislation is now much closer to EU standards than the previous version. For example, the new law is closer to EU norms on exemptions from general tender procedures, an issue that had been a concern for both the EU and Ukrainian society in the past. “Up to 90% of exemptions now meet the EU standards,” notes SerhiiYaremenko, the project’s expert on public procurement.

Yaremenko says that the manual’s target audiences are regulatory agencies, public purchasers, and tender participants. He believes that a key shortcoming of the Ukrainian public procurement system is a lack of professionalism and competency among public officials involved in procurement procedures. “The [Ukrainian state] budget does not provide funds for training public officials,” he explained. Under the current system, public servants must learn about procurement procedures independently, without the help of the government.

“We made the manual specifically for the purpose of increasing the knowledge and competency of public procurement stakeholders,” says Oleksandr Shatkovskyi, the EU project’s senior public procurement expert. Copies of the manual will be disseminated to public officials and published online for tender participants.

The manual also contains tests allowing stakeholders to assess their knowledge of public procurement legislation. For example, readers are quizzed on who is allowed to be present during competitive bidding procedures and what the deadline is for amendments to the bidding documents.

Derevyankin explains that the approximation of Ukraine’s public procurement system with EU standards will result in an open and competitive environment for tender participants. Open competition will result in lower prices and improved quality of goods and services. “Public procurements may also contribute to public policy on green procurement, resource savings, and innovation, further promoting EU standards,” he adds.

Background

The EU-funded project, “Harmonisation of Public Procurement System in Ukraine with EU Standards” commenced work in Kiev on November 11 2013. The project is being implemented by a consortium led by Crown Agents Ltd and will operate until November 2016. The other members of the consortium are the Chartered Institute of Purchasing and Supply (CIPS) and BDO LLP.

The project consists of five Components covering both the reform of the public procurement system and specific support for the development of the Ukrainian state aid system. Accordingly, the project is contributing to the development of a solid and consistent system of public sector financial management through promoting a comprehensive and transparent regulatory framework for public procurement, an efficient institutional infrastructure for public procurement, the accountability and integrity of public authorities in regard to public procurement, and the development of the Ukrainian state aid system.